Pub. 1 2020-2021 Issue 1

10 REFLEXION | 2020 | AIA Utah What can architects do to prepare for financially turbulent times? T he last several years have seen a major boom in the architecture business, but now a period of slower growth, indicated by the Architecture Billings Index, is pointing toward an impending downturn. In preparation, three firm leaders — Tim Dufault, FAIA, president and CEO at Cuningham Group; Carole Wedge, FAIA, CEO at Shepley Bulfinch; and Ed Shriver, FAIA, founding principal of Strada — share their insights on how their firms weathered previous tough times and what they’ve learned from decades of financial ups and downs. What lessons have you learned from the Great Recession and other, smaller downturns? Tim Dufault, FAIA: Diversification has been a key part of our practice; we try not to be too invested in any single market. Consequently, we can mitigate the typical fluctuations that happen in each of the different areas. Plus, I believe our geographic distribution — having six offices across the country — has helped alleviate some of the regional-based issues that pop up. Overall, our strategy has always focused on keeping a healthy mix of project types at all times. As the economic conditions in each of those markets change, we adapt and adjust appropriately. Carole Wedge, FAIA: Downturns affect capital building projects and slow things down considerably, but they don’t eliminate all work. During the Great Recession, one of our board advisors would say, “It might be 25% slower, but 75% of the work still exists, so make sure you’re staying close to your clients and helping with their needs.” In a recession, stick to the things you’re good at, make sure you’re talking to your clients at all times, and try and figure out what they need from architects. It could be more strategic planning, space utilization, small renovations, or a capital project that might go through with a lower budget. Remember that you are always valuable as a problem solver. Ed Shriver, FAIA: As for lessons learned, I’ll start with my rule No. 1: The talking heads don’t know any more than you do. I remember — a month or two before Lehman Brothers collapsed — thinking, “I don’t understand why, the economy is doing so well.” Everyone was saying, “Don’t worry, it’s not a bubble.” Two weeks later, boom. At that point, I said, “You know what? I’m not an idiot and those people aren’t as smart as they think they are.” Pay attention to what you’re seeing, and trust your gut. What steps have you taken in the past to survive during a downturn? Shriver: The first thing we did during the Great Recession was to call our landlord. We knew he was in the same boat as the rest of us, and empty office space is much less valuable than a tenant paying 75% of the rent. So we negotiated a discounted rate, which was in place until the recession ended. He was open to the idea, and we were able to show our employees a commitment to exploring outside-the-box options before considering layoffs. Hey, the worst thing he could do was say no. Three Firm Leaders Describe How to Survive an Economic Downturn BY STEVE CIMINO